Nigerian Coffee Farmers Aren't Benefitting From Global Price Hikes – CoffeeTalk

Coffee growers in Nigeria are struggling to benefit from high global prices due to low investments, capacity gaps, and poor seed quality. In contrast, their peers in Kenya, Rwanda, and Ethiopia are earning foreign exchange and creating more jobs for their people. Global coffee prices hit a 14-month high this month as adverse weather conditions battered harvest in the two world’s largest producers – Brazil and Vietnam – causing a global shortfall of the beans. Arabica beans, which account for most global production, topped $3.66/lb (a pound) this year, and Robusta coffee, a generally cheaper variety used mostly to make instant coffee, rose 0.9% to $5,609 a metric ton on Tuesday.

Nigeria grows both Arabica and Robusta coffee beans, with a kg of Arabica selling between N5,000 and N10,000 depending on the quality. A kg of Robusta beans, mainly grown in Kogi and Oyo, sells between N3,000 and N5,000 in Nigeria, while a ton goes for an average of N4 million ($2,667). The figure indicates that the Nigerian coffee farmer earns N4.4 million ($2,942) less than their peers in other coffee-producing countries ($5,609 or N8.4 million).

Nigerian farmers are not benefitting from the global coffee price rally, as local prices are not attractive and it has been a disincentive for them to grow more of the commodity. The sector lacks the structure to grow and attract investments, as seen in Rwanda, Ethiopia, and Kenya.

Nigeria’s young population, which constitutes about 63% of the country’s 200 million people, are developing a huge taste for coffee products but local production has stalled. The country’s coffee production has been on a steady decline with unattractive prices, making it difficult for farmers to expand production as they are unable to retain their cost. The low quality of the country’s coffee beans has made it unattractive for local processors to pay premium prices.

Nigeria’s coffee production, which peaked in the 1960s, has been on a steady decline, producing 1,844 metric tons of unroasted coffee in 2023, with an average yield of 500kg per hectare.

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